1. Legal Responses to Global Crime Threats
Law School
University of Roma Tre
April – May 2018
TRANSNATIONAL ORGANIZED CRIME Ambassador Dr Uglješa Ugi Zvekić

2. GLOBAL ORGANIZED CRIME & CORRUPTION
SDG 2030: retarding economic and human development (Goal 16)
Inverse correlation between competitiveness and corruption (free market)
Undermining democracy: weak institutions and no trust in institutions (de-based politics)
Decreasing equal opportunity (socio-economic and political credo)
Undermining moral virtues of integrity and work

3. Extent
Impact
Organized crime and corruption are not new but scale and scope have changed
New forms and methods of legitimization
Shifts in major illicit markets
Expansion of new criminal markets and demand for new commodities
Blurring of traditional producer, consumer and transit state typologies

4. Transnational Criminal Flows
Suppliers of criminal flows: not anymore mostly from developing world and countries in transition
Receivers: not only North America and West/Central Europe; Asia
BUT
Geopolitical equilibration of suppliers and receivers of illicit capital flows, money laundering, corruption, organized crime

5. ORGANIZED CORRUPTION Organized Crime and Corruption are profit-driven
Organized Crime, Corruption and Money Laundering are increasingly interlinked
While control over territory, goods and services is of utmost importance
TRADING IN INFLUENCE
par excellence
ORGANIZED CORRUPTION

7. Geography of Transnational Criminal Flows
Latin America to North America; West/Central Europe;West Africa
Asia (Afghanistan) to West/Central Europe; Central Asia/RF
North Africa to West Europe;South/Central Africa to SouthEast Asia/China/Japan
Eastern Europe to West Europe;South/Central Africa
West Europe to Eastern Europe/Afghanistan
West Europe - within

8. Geopolitics of Transnational Criminal Flows
Suppliers of criminal flows: mostly from developing world and countries in transition
Receivers: North America and West/Central Europe; Asia
But
Europe/North America: Suppliers of illegal arms, precursors, illicit capital flows, money laundering, corruption, female trafficking victims

9. Geopolitics of Transnational Organized Crime Flows vs. Markets
Disparity between the geography of criminal flows and criminal markets
Criminal Flows: from developing to developed
Criminal Markets : developed (but increasingly developing)

10. INTERNATIONAL LEGAL RESPONSES
Drug Conventions
United Nations Convention against Transnational Organized Crime – UNTOC (Palermo Convention) with Protocols (human trafficking; smuggling of migrants; firearms trafficking)
United Nations Convention against Corruption – UNCAC (Merida Convention)
EU; CoE; Regional conventions and protocols; OECD

11. United Nations Convention against Transnational Organized Crime (Palermo Convention)
Adopted by GA Resolution 55/25 of 15 November 2000; open for signing & ratification at Palazzo di Giustizia (Palermo)
Entered into force on 29 November 2003
Parties: 186

12. Criminal Markets for Persons
Sexual exploitation: 79%
Forced Labour: 18%
Markets mostly located in North America/West Europe increasingly in Africa and Asia
Increased labour exploitation in developed markets due to “making the labour closer to the capital” and demand for counterfeiting

13. Protocols supplementing UNTOC (1)
The Protocol to Prevent, Supress and Punish Trafficking in Persons, especially Women and Children: in force as of 25 December 2003; Parties: 159; Serbia: Ratified
The Protocol against Smuggling of Migrants by Land, Sea and Air: in force as of 28 January 2004; Parties: 138; Serbia: Ratified

14. Drugs: Flows
Heroin: 90% from Afghanistan to Russia and Europe (via the Northern and the Balkan routes)
Cocaine: vast bulk from the Andean region to North America and Europe (via Central America; West Africa) and Southern Cone of Latin America
Cannabis: From Africa (Morocco) and Asia (Afghanistan) to Europe; from Central America to North America but increased domestic production; the challenges of legalization (Dutch; Uruquay; Colorado; Washington State)
New Psychoactive Substances: worldwide production and trafficking

15. Drugs: Markets
The largest world market is for cannabis: increased supply from foreign and domestic production – an increasing world market
Cocaine: decline in the USA market but Europe becoming the largest world market; emerging cocaine market in Southern Cone of Latin America
Heroin: increasing Russian market but stable European market
NPS: the fastest growing production, trafficking and world market

16. International Drugs Conventions
Single Convention on Narcotic Drugs of 1961
Parties: 184; Italy; Ratified
Convention on Psychotropic Substances of 1971
Parties: 183; Italy: Ratified
United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances of 1988
Parties: 189; Italy: Ratified

17. Cigarette Smuggling One of the biggest and the oldest TOC business
Out of estimated USD 16 billion global cigarette trade 25% is illict
Traditional OC (e.g. Italian Mafia; the Balkan OC; Polish OC; Russian and CA OC; )
Non-European: Turkish OC; Arabian OC (North Africa/Middle East)
Within EU: Dutch, Belgium, UK
Hard-core “drug traffickers” but also migrants and elderly living from a social security allowances (informal economy)
Big multinational companies (e.g. R.J.Reynolds in breach of the UN and the US embargo on Iraq): Puerto Rico – EU ports – Cyprus – Lebanon – Turkey - Iraq

18. Cigarette Smuggling: Why still there ?
One of the oldest smuggling activities
State control vs. unpaid duties and tax evasion (VAT)
Cigarette smuggling flow: towards markets with the highest excise rate (UK; Ireland; France; Germany; Nordics) – the Northern trade belt
Western Balkans considered one of the most dyamic areas for cigarette smuggling

19. Tobacco Convention WHO Framework Convention on Tobacco Control
Adopted in 2003
Entered into force: 19 September 2013
Parties: 179; USA: signed 10 May 2009
Protocol to Eliminate Illicit Trade in Tobacco Products
Signed by 56; Nicaragua ratified; USA: not signed

22. Italian Criminal Markets
One of the oldest TOC Mafia but also Camorra and ‘Ndrangheta
Today it is not the control of the territory but the market control
Criminal market annual value: 170 billion EURO or 10% GDP
Drug Trafficking: 7.7 b; Extorsion: 4.7 b; Prostitution 4.6; Counterfeiting 4.5
Construction; Special Litter Disposal; Restaurants; Hazard Games; Gold exchange

23. МEXICO
95% of cocaine comes from Mexico to the US with an annual value of 10 billion EURO
The leader fo the biggest cartel “Sinaloa” – El Chapo was arrested twice and waiting for extradition to the US
5 main cartels: Sinaloa; Los Zetas; Cartel del Golfo; Cartel de Juarez; Cartel del Jalisco
From 2006 some victims of the inter- cartel conflict
However, cannabis drug trafficking into USA reduced (legalization of marijuana in WA,CO,OR,AL)

24. East Asia
East Asia, in particular China, will become the most prosperous criminal market both in terms of demand and supply:
Drug trafficking, production, consumption;
Human trafficking/smuggling of migrants
Trafficking in human body parts
Cyber crime
Fraud and corruption
Counterfeiting
Wild life/ivory illicit import

25. Balkans (1)
Origins of OC in the Balkans (profit and opportunity driven crime export and import)
Boom during the 90s Yugoslav conflict and sanctions
Connections among criminal networks, para- military, local leaders and sometimes security services; connections with ex-Yugoslav and foreign OC groups

26. Balkans (2) Drug trafficking but also cannabis and NPS production
Cigarettes smuggling
Extortion
Smuggling of migrants/human trafficking
Corruption
Small arms trafficking
Money laundering
Counterfeited goods production and trafficking

27. AFRICA
Arab countries (Lybia): smuggling of migrants and human trafficking; arms trafficking; drugs (kat)
West Africa: cocain (from Latin America – Brazil) and cannabis to Europe; human trafficking; corruption
Southern Africa: human trafficking; poaching; wild life trafficking (ivory; rhino horn; etc.); “blood diamonds”; illicit extractions

28. Geopolitical Configuration of Transnational Organized Criminal Flows and Markets (2)
Increasing global trend of the TOC to gain (and maintain) licit position through merging legal and illegal flows and markets: the legalization of profit
Ownership of enterprises or holding of executive/managerial positions : the control over the profit legalization process
Investments in economic sectors (e.g. entertainment/hotels; construction; waste disposal;) difficult to control
Links with political parties/trade unions
Increased use of e-technology for criminal enterprise

29. Organized Corruption: Markets
Increasingly becoming organized as it requires many actors to design, effect, launder and legalize/invest
Less distinction between active and passive corruption
Less distinction between public and private sector corruption
Increase due to developmental disparities and investment opportunities

30. ORGANIZED CRIME STRATEGY
Legitimization of the illicit activities, status and profits as the main strategy
Increased organized corruption both as a mean and an end in itself
Increased presence of OC in the management and political authority structures to influence and control the process of legalization and legitimization of illicit flows and gains
Increased investments in formal economy and ownership of companies and shares

31. LEGITIMIZATION and LEGALIZATION
Part of the criminal profit goes to
1. maintenance and reproduction costs of the organization
(operational costs; management cost; personal expenses)
2. social legitimization and respect (members’ and community welfare; political affiliations)
Instrumental legalization costs (money-laundering and corruption costs; political and economic favours)
Investments: in bars, hotels, restaurants, wholesale, retail estate, transportation and companies/shares

32. THANK YOU